The Markets (as of market close November 15, 2024)
Last week saw stocks close markedly lower as investors were discouraged by hawkish comments from Federal Reserve Chair Jerome Powell, who put a damper on the likelihood of another interest rate decrease this year. Among the market sectors, energy, financials, and utilities closed the week higher, while the remaining sectors ended the week in the red, led by health care, which saw stocks fall after President-elect Trump’s appointment of Robert Kennedy as secretary of the Department of Health and Human Services. Ten-year Treasury yields hovered near the highest level since June, reflecting the diminished probability of interest rate cuts. Crude oil and gold prices declined, while the dollar advanced.
Stocks closed higher last Monday as both the Dow (0.7%) and the S&P 500 (0.1%) reached record highs. The Russell 2000 led the benchmark indexes listed here, gaining 1.5%, while the NASDAQ and the Global Dow each ticked up 0.1%. Consumer discretionary and financials led the market sectors. Crypto-related companies saw sharp gains. Gold dropped 2.4%, extending losses and falling to its lowest level in a month. Crude oil prices declined 3.1% to $68.20 per barrel, pulled lower by a strong dollar (+0.5%) and concerns over China’s waning demand for crude. The bond market was closed in observance of Veterans Day.
The market saw its rally end last Tuesday. Investor preference for risk cooled amid concerns about the economy and inflation, which prompted profit-taking following recent market highs. The Russell 2000 (-1.8%) and the Global Dow (-1.3%) declined the furthest, followed by the Dow (-0.9%), the S&P 500 (-0.3%), and the NASDAQ (-0.1%). Ten-year Treasury yields gained 12.4 basis points to 4.43%. Crude oil prices closed at $68.10 per barrel. The dollar gained 0.4%. Gold prices fell 0.4%.
Of the benchmark indexes listed here, the Dow and the S&P 500 barely edged higher last Wednesday, while the Russell 2000 (-0.9%), the NASDAQ (-0.3%), and the Global Dow (-0.2%) declined. Ten-year Treasury yields increased to 4.45%. Crude oil prices dipped to $68.04 per barrel. The dollar continued to rise, gaining 0.4%, while gold prices fell 1.0%. Investors may be exercising caution following the latest Consumer Price Index (see below), which showed disinflation has stalled a bit.
Stocks declined on Thursday after Fed Chair Jerome Powell stated that there was no urgency to lower interest rates given the strength of the economy. The small caps of the Russell 2000 declined for the third straight day after dropping 1.4%. The NASDAQ and the S&P 500 each fell 0.6%. The Dow lost 0.5% and the Global Dow dipped 0.3%. The yield on 10-year Treasuries slipped 3.3 basis points to end the session at 4.41%. Crude oil prices increased for the first time last week, closing at $68.70 per barrel. The dollar advanced 0.4%, while gold prices declined 0.5%.
Last Friday saw stocks close sharply lower with each of the benchmark indexes listed here losing value. The NASDAQ dropped 2.2%, the Russell 2000 fell 1.4%, the S&P 500 declined 1.3%, the Dow decreased 0.7%, and the Global Dow slid 0.2%. Ten-year Treasury yields closed up at 4.44%. Crude oil prices fell 2.4%, the dollar ticked up 0.1%, while gold prices declined for the fifth straight session.
Stock Market Indexes
Market/Index
2023 Close
Prior Week
As of 11/15
Weekly Change
YTD Change
DJIA
37,689.54
43,988.99
43,444.99
-1.24%
15.27%
NASDAQ
15,011.35
19,286.78
18,680.12
-3.15%
24.44%
S&P 500
4,769.83
5,995.54
5,870.62
-2.08%
23.08%
Russell 2000
2,027.07
2,399.64
2,303.84
-3.99%
13.65%
Global Dow
4,355.28
4,990.57
4,913.45
-1.55%
12.82%
fed. funds target rate
5.25%-5.50%
4.50%-4.75%
4.50%-4.75%
0 bps
-75 bps
10-year Treasuries
3.86%
4.30%
4.44%
14 bps
58 bps
US Dollar-DXY
101.39
104.92
106.73
1.73%
5.27%
Crude Oil-CL=F
$71.30
$70.48
$66.96
-4.99%
-6.09%
Gold-GC=F
$2,072.50
$2,691.30
$2,566.00
-4.66%
23.81%
Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.
Last Week’s Economic News
The Consumer Price Index rose 0.2% in October, the same increase as in each of the previous three months. For the 12 months ended in October, the CPI increased 2.6%, up 0.2 percentage point from the same period ended in September. Prices, excluding food and energy, rose 0.3% in October and 3.3% over the last 12 months. Prices for shelter rose 0.4% in October, accounting for over half of the monthly increase. Food prices also increased over the month. Prices for energy were unchanged over the month after declining 1.9% in September.
The Producer Price Index rose 0.2% in October following a 0.1% bump in September. Producer prices moved up 2.4% for the 12 months ended in October. Most of the October increase can be traced to a 0.3% in crease in prices for services. Goods prices inched up 0.1%. Producer prices less foods, energy, and trade services increased 0.3% in October after moving up 0.1% in September. For the 12 months ended in October, prices less foods, energy, and trade services rose 3.5%.
Retail and food services sales rose 0.4% in October and increased 2.8% for the 12 months ended in October. Retail trade sales were up 0.4% last month and up 2.6% from last year. Nonstore (online) retailer sales were up 7.0% from October 2023, while food services and drinking places sales increased 4.3% over the same period.
Import prices rose 0.3% in October following a 0.4% decline in September. The October increase was the largest one-month advance since April 2024. Fuel prices rose 1.5% last month after declining 7.5% in September, marking the largest monthly increase since April 2024. Despite the October increase, import fuel prices declined 13.6% for the year ended in October. Nonfuel import prices increased 0.2% for the second consecutive month in October. Import prices increased 0.8% from October 2023 to October 2024. Prices for exports increased 0.8% in October, which was the largest monthly rise since August 2023. Higher prices for nonagricultural and agricultural exports in October contributed to the monthly increase. Despite the October rise, export prices declined 0.1% over the past year.
According to the Federal Reserve’s latest report, industrial production declined 0.3% in October after falling 0.5% the previous month. A strike at a major producer of civilian aircraft, coupled with the lingering effects of Hurricanes Milton and Helene contributed to the October decline. Manufacturing fell 0.5% last month, while mining and utilities rose 0.3% and 0.7%, respectively. Industrial production in October was 0.3% below its year-earlier level.
October 2024, the first month of fiscal year 2025, saw a monthly government deficit of $257.5 billion, well above the $66.6 billion deficit reported for October 2023. Government receipts were $326.8 billion, while expenditures totaled $584.2 billion.
The national average retail price for regular gasoline was $3.052 per gallon on November 11, $0.017 per gallon below the prior week’s price and $0.297 per gallon less than a year ago. Also, as of November 11, the East Coast price increased $0.010 to $3.002 per gallon; the Midwest price decreased $0.071 to $2.866 per gallon; the Gulf Coast price rose $0.011 to $2.630 per gallon; the Rocky Mountain price dipped $0.028 to $3.075 per gallon; and the West Coast price fell $0.021 to $3.924 per gallon.
For the week ended November 9, there were 217,000 new claims for unemployment insurance, a decrease of 4,000 from the previous week’s level. According to the Department of Labor, the advance rate for insured unemployment claims for the week ended November 2 was 1.2%, unchanged from the previous week’s rate. The advance number of those receiving unemployment insurance benefits during the week ended November 2 was 1,873,000, a decrease of 11,000 from the previous week’s level, which was revised down by 8,000. States and territories with the highest insured unemployment rates for the week ended October 26 were New Jersey (2.2%), California (2.0%), Puerto Rico (1.9%), Washington (1.7%), Nevada (1.6%), Rhode Island (1.6%), Alaska (1.5%), Massachusetts (1.5%), New York (1.5%), Illinois (1.4%), and Pennsylvania (1.4%). The largest increases in initial claims for unemployment insurance for the week ended November 2 were in California (+3,825), Michigan (+3,439), Ohio (+1,911), New Jersey (+1,317), and Kansas (+870), while the largest decreases were in Florida (-1,530), Georgia (-1,303), Missouri (-797), New York (-469), and Washington (-364).
Eye on the Week Ahead
The focus is on the housing sector this week. The report on housing starts for October is out on Tuesday. September saw the number of housing starts and issued building permits decline. Also out this week is the report on existing home sales for October. Sales fell in September from the previous month as did the median sales price.
Investors had plenty to think about last week as they focused on the results of the presidential election and the Federal Reserve’s move to further reduce interest rates (see below). Each of the benchmark indexes listed here closed up by the end of the week, with consumer discretionary, information technology, and financials outperforming. Bond prices ended the week higher, pulling yields lower. Crude oil prices rose to over $72.00 per barrel only to slip back a bit at the end of the week. The dollar inched higher, while gold prices declined. According to Freddie Mac, mortgage rates rose to 6.79% on November 7, the highest they’ve been in nearly four months.
Last Monday saw stocks tumble as election uncertainty weighed on the markets. Of the benchmark indexes listed here, only the Russell 2000 (0.4%) posted a gain. The Dow lost 0.6%, the NASDAQ and the S&P 500 each fell 0.3%, and the Global Dow dipped 0.1%. Ten-year Treasury yields fell 5.2 basis points to close at 4.30%. Crude oil prices rose 3.2% to reach $71.69 per barrel. The dollar lost 0.4%, while gold prices slipped 0.1%.
Stocks rallied last Tuesday as investors awaited the results of the presidential election. The Russell 2000 led the benchmark indexes listed here, gaining 1.9%. The NASDAQ rose 1.4%, the S&P 500 gained 1.2%, the Dow advanced 1.0%, and the Global Dow climbed 0.9%. Ten-Year Treasury yields closed at 4.28%. Crude oil prices rose 1.0%, closing at $72.16 per barrel. The dollar slipped 0.4%, while gold prices advanced 0.2%.
Wall Street enjoyed a robust day following the presidential election. Investors showed optimism that a second Trump administration may favor businesses and boost economic growth. Each of the benchmark indexes jumped higher, led by the Russell 2000 (5.8%), followed by the Dow (3.6%), the NASDAQ (3.0%), the S&P 500 (2.5%), and the Global Dow (0.7%). Yields on 10-year Treasuries rose more than 13.0 basis points to 4.42%. The dollar index, at 105.14, reached its highest level in four months. Crude oil prices dipped 0.2%, settling at $71.84 per barrel. Gold prices fell nearly 3.0%.
Stocks closed mostly higher last Thursday, with the NASDAQ (1.5%), the S&P 500 (0.7%), and the Global Dow (0.7%) advancing, while the Russell 2000 fell 0.4%. The Dow was flat. The ten-year Treasury yield slid to 4.34%. Crude oil prices rose to $72.16 per barrel. The dollar fell 0.7%, while gold prices rose 1.4%.
The S&P 500 (0.4%) and the Dow (0.6%) closed at record highs last Friday, buoyed by the Fed’s latest interest rate cut. The Russell 2000 gained 0.7%, the NASDAQ rose 0.1%, while the Global Dow fell 0.5%. Ten-year Treasury yields continued to tumble, closing the session at 4.30%. Crude oil prices dipped 2.7%, gold prices lost 0.5%, while the dollar climbed 0.4%.
Stock Market Indexes
Market/Index
2023 Close
Prior Week
As of 11/8
Weekly Change
YTD Change
DJIA
37,689.54
42,052.19
43,988.99
4.61%
16.71%
NASDAQ
15,011.35
18,239.92
19,286.78
5.74%
28.48%
S&P 500
4,769.83
5,728.80
5,995.54
4.66%
25.70%
Russell 2000
2,027.07
2,210.13
2,399.64
8.57%
18.38%
Global Dow
4,355.28
4,902.55
4,990.57
1.80%
14.59%
fed. funds target rate
5.25%-5.50%
4.75%-5.00%
4.50%-4.75%
-25 bps
-75 bps
10-year Treasuries
3.86%
4.36%
4.30%
-6 bps
44 bps
US Dollar-DXY
101.39
104.34
104.92
0.56%
3.48%
Crude Oil-CL=F
$71.30
$69.47
$70.48
1.45%
-1.15%
Gold-GC=F
$2,072.50
$2,743.70
$2,691.30
-1.91%
29.86%
Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.
Last Week’s Economic News
By a unanimous vote, the Federal Open Market Committee (FOMC) decided to cut interest rates an additional 25.0 basis points. The federal funds target rate range is now 4.50%-4.75%. The Committee noted that economic activity has continued to expand at a solid pace, labor market conditions have generally eased, and the unemployment rate moved up but remained low. Inflation has progressed toward the Committee’s 2.0% objective but remained somewhat elevated. In sum, the Committee would be prepared to adjust its monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals of 2.0% inflation and maximum employment.
The international trade in goods and services deficit was $84.4 billion in September, up $13.6 billion, or 19.2%, from $70.8 billion in August, revised. September exports were $267.9 billion, $3.2 billion, or 1.2%, less than August exports. September imports were $352.3 billion, $10.3 billion, or 3.0%, more than August imports. Year to date, the goods and services deficit increased $69.6 billion, or 11.8%, from the same period in 2023. Exports increased $84.7 billion, or 3.7%. Imports increased $154.4 billion, or 5.3%.
The S&P Global US Services PMI® Business Activity Index registered 55.0 in October, down slightly from 55.2 in September. A reading of 50.0 or higher indicates growth, thus services activity expanded solidly last month but at a slightly slower pace than in September. The services sector has expanded in each of the past 21 months. New orders grew at a solid pace in October. However, firms continued to scale back staffing levels amid uncertainty over future demand.
The national average retail price for regular gasoline was $3.069 per gallon on November 4, $0.028 per gallon below the prior week’s price and $0.327 per gallon less than a year ago. Also, as of November 4, the East Coast price declined $0.053 to $2.992 per gallon; the Midwest price increased $0.014 to $2.937 per gallon; the Gulf Coast price fell $0.027 to $2.619 per gallon; the Rocky Mountain price dipped $0.095 to $3.103 per gallon; and the West Coast price fell $0.028 to $3.945 per gallon.
For the week ended November 2, there were 221,000 new claims for unemployment insurance, an increase of 3,000 from the previous week’s level, which was revised up by 2,000. According to the Department of Labor, the advance rate for insured unemployment claims for the week ended October 26 was 1.2%, unchanged from the previous week’s rate. The advance number of those receiving unemployment insurance benefits during the week ended October 26 was 1,892,000, an increase of 39,000 from the previous week’s level, which was revised down by 9,000. This is the highest level for insured unemployment since November 13, 2021, when it was 1,974,000. States and territories with the highest insured unemployment rates for the week ended October 19 were New Jersey (2.2%), California (1.9%), Puerto Rico (1.8%), Washington (1.7%), Nevada (1.6%), Rhode Island (1.6%), Massachusetts (1.5%), New York (1.5%), Alaska (1.4%), Illinois (1.4%), and Pennsylvania (1.4%). The largest increases in initial claims for unemployment insurance for the week ended October 26 were in New York (+1,983), Michigan (+1,722), Illinois (+1,066), Texas (+757), and Ohio (+706), while the largest decreases were in North Carolina (-2,859), Florida (-2,429), California (-1,876), Virginia (-824), and Washington (-698).
Eye on the Week Ahead
The latest inflation data for October is available this week with the release of the Consumer Price Index, the Producer Price Index, and the report on import and export prices. The CPI rose 0.2% in September but ticked down 0.1 percentage point to 2.4% year over year. Producer prices, on the other hand, were flat in September and up only 1.8% since September 2023.
Wall Street saw stocks end October with a whimper, although equities began November on a high note. Each of the benchmark indexes listed here closed last week lower, except the Russell 2000. A surprisingly weak jobs report (see below) at the end of the week was offset by solid earnings reports from a couple of tech giants. Analysts speculated that the October labor data was impacted by hurricane disruptions and a strike at a major airplane manufacturer. Consumer discretionary and communication services were the only market sectors to end the week higher. Utilities, real estate, and information technology fell the furthest. Ten-year Treasury yields reached the highest rate in nearly four months as the latest economic data favored a slightly more hawkish Federal Reserve. Crude oil prices closed the week with three consecutive days of gains, but not enough to recover from a downturn earlier in the week.
Stocks ended higher last Monday as investors awaited a batch of major corporate earnings reports. The Russell 2000 added 1.6% to lead the benchmark indexes listed here. The Dow advanced 0.7%, followed by the Global Dow, which rose 0.5%. The NASDAQ and the S&P 500 each gained 0.3%. Ten-year Treasury yields closed at 4.27%, an increase of 4.6 basis points. Crude oil prices plunged 5.2% to $68.02 per barrel after Iranian crude oil facilities escaped Israeli bombardment, easing fears of disruptions to energy supplies. Both the dollar and gold prices were relatively unchanged by the close of trading.
Last Tuesday saw the NASDAQ (0.8%) and the S&P 500 (0.2%) close higher, while the remaining indexes ended the session in the red. The Dow fell 0.4%, while the Russell 2000 and the Global Dow each ended the day down 0.3%. Yields on 10-year Treasuries remained at 4.27%. Crude oil prices slid to $67.30 per barrel. The dollar was flat, while gold prices rose 1.1%.
Investors were cautious last Wednesday ahead of earnings results from some big tech companies. Each of the benchmark indexes listed here lost ground, led by the NASDAQ (-0.6%), and followed by the Global Dow (-0.5%), the S&P 500 (-0.3%), the Dow (-0.2%), and the Russell 2000 (-0.2%). Ten-year Treasury yields ticked lower, settling at 4.26%. Crude oil prices rebounded, gaining 2.5% to close at about $68.91 per barrel. The dollar fell 0.2%, while gold prices rose 0.6%.
Stocks continued to trend lower last Thursday as weak earnings data from some tech giants dampened investors’ zeal for risk. The NASDAQ fell 2.8%, followed by the S&P 500 (-1.9%), the Russell 2000 (-1.6%), the Dow (-0.9%), and the Global Dow (-0.8%). Crude oil prices climbed higher for the second straight day, gaining 2.8% to close at $70.62 per barrel. Ten-year Treasury yields inched up 1.8 basis points to 4.28%. The dollar and gold prices declined.
Wall Street kicked off November with a bang as stocks closed sharply higher last Friday. Strong earnings from two giant tech companies bolstered market sentiment despite a weak jobs report. The NASDAQ (0.8%) led the benchmark indexes listed here, followed by the Dow (0.7%), the Russell 2000 (0.6%), the S&P 500 (0.4%), and the Global Dow (0.3%). As stocks moved higher, bond values declined, pushing yields higher. Ten-year Treasury yields ended the session up 1.8% to close at 4.36%. Crude oil prices rose 0.4%. Gold prices dipped 0.2%, while the dollar gained 0.4%.
Stock Market Indexes
Market/Index
2023 Close
Prior Week
As of 11/1
Weekly Change
YTD Change
DJIA
37,689.54
42,114.40
42,052.19
-0.15%
11.58%
NASDAQ
15,011.35
18,518.61
18,239.92
-1.50%
21.51%
S&P 500
4,769.83
5,808.12
5,728.80
-1.37%
20.10%
Russell 2000
2,027.07
2,207.99
2,210.13
0.10%
9.03%
Global Dow
4,355.28
4,939.32
4,902.55
-0.74%
12.57%
fed. funds target rate
5.25%-5.50%
4.75%-5.00%
4.75%-5.00%
0 bps
-50 bps
10-year Treasuries
3.86%
4.23%
4.36%
13 bps
50 bps
US Dollar-DXY
101.39
104.32
104.34
0.02%
2.91%
Crude Oil-CL=F
$71.30
$71.59
$69.47
-2.96%
-2.57%
Gold-GC=F
$2,072.50
$2,757.40
$2,743.70
-0.50%
32.39%
Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.
Last Week’s Economic News
Employment was essentially unchanged (+12,000) in October after adding 223,000 (revised) new jobs in September. The average monthly gain over the prior 12 months was 194,000. According to the latest report from the Bureau of Labor Statistics, Hurricanes Helene and Milton may have impacted the collection and accuracy of data in October. Nevertheless, the unemployment rate remained at 4.1%, while the number of unemployed persons increased by 150,000. These measures are higher than a year earlier, when the jobless rate was 3.8%, and the number of unemployed people was 6.4 million. The labor force participation rate fell 0.1 percentage point to 62.6%. The employment-population ratio declined 0.2 percentage point to 60.0%. The number of long-term unemployed (those jobless for 27 weeks or more) was little changed at 1.6 million in October. This measure is up from 1.3 million a year earlier. In October, the long-term unemployed accounted for 22.9% of all unemployed people. The change in total employment for August was revised down by 81,000, and the change for September was revised down by 31,000. With these revisions, employment in August and September combined was 112,000 lower than previously reported. In October, average hourly earnings rose by $0.13, or 0.4%, to $35.46. Over the past 12 months, average hourly earnings have increased by 4.0%. The average workweek was unchanged at 34.3 hours in October.
According to the initial estimate, third-quarter gross domestic product increased at an annual rate of 2.8%. In the second quarter, GDP advanced 3.0%. The increase in GDP primarily reflected increases in consumer spending (3.7%), exports (8.9%), and federal government spending (9.7%). Imports, which are a subtraction in the calculation of GDP, increased 11.2%. The personal consumption expenditures (PCE) price index increased 1.5%, compared to an increase of 2.5% in the second quarter. Excluding food and energy prices, the PCE price index increased 2.2% (2.8% in the second quarter).
In September, personal income and disposable personal income each increased 0.3%. Personal consumption expenditures (PCE) advanced 0.5%. The PCE price index moved up 0.2%. Excluding food and energy (core prices), the PCE price index rose 0.3%. Over the last 12 months, the PCE price index climbed 2.1%, while the core PCE price index increased 2.7%.
The international trade in goods deficit increased $14.0 billion, or 14.9%, in September over the prior month. A $10.4 billion increase in imports more than offset a $3.6 billion decrease in exports.
According to the latest Job Openings and Labor Turnover Summary, the number of job openings in September, at 7.4 million, declined about 400,000 from the August estimate and decreased 1.9 million since September 2023. The number of hires changed little at 5.6 million in September. The number of total separations in September was unchanged at 5.2 million but was down 326,000 over the last 12 months. In September, the number of quits changed little at 3.1 million but declined 525,000 over the year. The number of job openings for August was revised down by 179,000 to 7.9 million, the number of hires was revised up by 118,000 to 5.4 million, and the number of total separations was revised up by 171,000 to 5.2 million.
New orders continued to decline in the manufacturing sector, according to the latest survey results from the S&P Global US Manufacturing Purchasing Managers’ Index™ (PMI®). On the plus side, the pace of the decline was the slowest in three months. Nevertheless, manufacturers continued to reduce employment and purchasing activity. The October PMI was 48.5, up from 47.3 in September, but below the 50.0 no-change mark for the fourth consecutive month.
The national average retail price for regular gasoline was $3.097 per gallon on October 28, $0.047 per gallon below the prior week’s price and $0.376 per gallon less than a year ago. Also, as of October 28, the East Coast price declined $0.009 to $3.045 per gallon; the Midwest price decreased $0.083 to $2.923 per gallon; the Gulf Coast price inched down $0.074 to $2.646 per gallon; the Rocky Mountain price dipped $0.023 to $3.198 per gallon; and the West Coast price fell $0.061 to $3.973 per gallon.
For the week ended October 26, there were 216,000 new claims for unemployment insurance, a decrease of 12,000 from the previous week’s level, which was revised up by 1,000. According to the Department of Labor, the advance rate for insured unemployment claims for the week ended October 19 was 1.2%, unchanged from the previous week’s rate, which was revised down by 0.1 percentage point to 1.2%. The advance number of those receiving unemployment insurance benefits during the week ended October 19 was 1,862,000, a decrease of 26,000 from the previous week’s level, which was revised down by 9,000. States and territories with the highest insured unemployment rates for the week ended October 12 were New Jersey (2.1%), California (1.9%), Puerto Rico (1.8%), Washington (1.8%), Nevada (1.6%), Rhode Island (1.6%), Illinois (1.4%), Massachusetts (1.4%), Michigan (1.4%), and New York (1.4%). The largest increases in initial claims for unemployment insurance for the week ended October 19 were in Florida (+4,501), Kansas (+304), Wisconsin (+222), Hawaii (+103), and Idaho (+101), while the largest decreases were in New York (-2,785), North Carolina (-2,767), California (-2,012), Texas (-1,865), and Georgia (-1,852).
Eye on the Week Ahead
The first full week of November is somewhat lacking in the release of important economic data. However, the focus will be on the Federal Reserve’s statement following its latest meeting on November 7. After reducing the federal funds target range by 50.0 basis points in September, it is possible that the Fed will make no changes in November and may wait until its final meeting of the year in December to adjust rates further.
Stocks closed lower in October as Wall Street couldn’t maintain the momentum from September’s strong showing after the Fed lowered interest rates. Equities began October on an upswing on the heels of a better-than-expected jobs report. In fact, during the first half of the month, the Dow and the S&P 500 reached record highs. However, investors began moving away from risk as the unrest in the Middle East intensified and sentiment grew that the Fed may not cut rates in November. Toward the end of the month, disappointing earnings data from big tech companies raised concerns about rising AI costs and the potential for profit pressures. Among the market sectors, only communication services, financials, and energy managed to outperform. Health care, materials, real estate, and consumer staples lagged.
Inflationary data showed price pressures edged higher but came within expectations. For the 12 months ended in September, the Consumer Price Index (CPI) dipped lower, while the annual rate for the personal consumption expenditures (PCE) price index came in at 2.1%, the lowest rate since early 2021 as each indicator moved closer to the Federal Reserve’s 2.0% target rate range.
Growth of the U.S. economy continued at a modest pace. The gross domestic product (GDP) met expectations after increasing 2.8% in the third quarter following a 3.0% increase in the second quarter (see below). Personal consumption expenditures, the largest contributor in the calculation of GDP, rose 3.7%, with spending rising in durable goods and nondurable goods. Government expenditures, up 5.0%, were the second largest contributor to GDP.
Job growth in September far exceeded expectations after adding 254,000 jobs, which followed upward revisions in both July and August. The unemployment rate slid 0.1 percentage point to 4.1%, while the number of unemployed declined. Wage growth rose 0.4% in September and 4.0% over the past 12 months. The Fed’s 50-basis-point decrease in interest rates probably played a large part in the spurt in job growth in September. However, the latest jobs data also will likely encourage tempering the pace of further rate cuts. New weekly unemployment claims decreased from a year ago, while total claims paid increased (see below).
With about 37% of the S&P 500 companies reporting, third-quarter earnings results have been mixed. While the S&P 500 reported earnings growth for the fifth straight quarter, it was the lowest growth rate since the second quarter of 2023. Of the companies reporting thus far, roughly 75% have indicated actual earnings per share (EPS) above estimates, which is below the 5-year average of 77% but equal to the 10-year average of 75%. Companies in the financials and consumer discretionary sectors were the largest contributors to the increase in overall earnings growth thus far. On the other hand, earnings lagged from companies in the industrials, health care, and energy sectors.
Rising mortgage rates cooled real estate sales over the past few months. However, with rates gradually falling and inventory increasing, the home sector is expected to bounce back. In September sales of existing homes declined, while new home sales increased. According to Freddie Mac, the 30-year fixed-rate mortgage averaged 6.44% as of October 17, up from 6.32% one week earlier, but down from 7.63% from one year ago.
Industrial production retracted in September from August, which saw a 0.3% decline. Manufacturing output decreased 0.4% in September and was 0.5% below its year-earlier level. This trend was further endorsed by purchasing managers, who reported manufacturing continued to slow in September. On the other hand, the services sector rose modestly higher.
November proved to be a rocky month for bonds. Ten-year Treasury yields closed the month up, reaching the highest level in over three months. as favorable economic data supported the notion that the U.S. economy could withstand higher interest rates. The two-year note closed November at 4.18%, a monthly gain of 5.7 basis points. The dollar strengthened, marking its strongest monthly gain in more than two years. Gold prices hit a record high of $2,790.00 during the month, only to slip lower, but well into the black for November. Crude oil prices rose higher by the end of the month, but remained somewhat subdued, as investors anticipated a supply increase by OPEC+ in October and decreased demand in China. The retail price of regular gasoline was $3.097 per gallon on October 28, $0.082 below the price a month earlier and $0.376 less than the price a year ago.
Stock Market Indexes
Market/Index
2023 Close
Prior Month
As of October 31
Monthly Change
YTD Change
DJIA
37,689.54
42,330.15
41,763.46
-1.34%
10.81%
NASDAQ
15,011.35
18,189.17
18,095.15
-0.52%
20.54%
S&P 500
4,769.83
5,762.48
5,705.45
-0.99%
19.62%
Russell 2000
2,027.07
2,229.97
2,196.65
-1.49%
8.37%
Global Dow
4,355.28
5,029.62
4,892.56
-2.73%
12.34%
fed. funds target rate
5.25%-5.50%
4.75%-5.00%
4.75%-5.00%
0 bps
-50 bps
10-year Treasuries
3.86%
3.80%
4.28%
48 bps
42 bps
US Dollar-DXY
101.39
100.75
103.89
3.12%
2.47%
Crude Oil-CL=F
$71.30
$68.35
$70.40
3.00%
-1.26%
Gold-GC=F
$2,072.50
$2,654.60
$2,756.30
3.83%
32.99%
Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark the performance of specific investments.
Latest Economic Reports
Employment: Total employment increased by 254,000 in September, well above the consensus of 132,500 and higher than the 12-month average gain of 203,000. The September estimate followed upward revisions in both July and August, which, combined, were 72,000 higher than previously reported. In September, job gains occurred in food services and drinking places, health care, government, social assistance, and construction. The unemployment rate for September ticked down 0.1 percentage point to 4.1% but was 0.3 percentage point above the rate from a year earlier (3.8%). The number of unemployed persons, at 6.8 million, was 281,000 below the August figure, but 487,000 above the September 2023 estimate. The number of long-term unemployed (those jobless for 27 weeks or more) at 1.6 million, was 97,000 above the August total and accounted for 23.7% of all unemployed people. The labor force participation rate, at 62.7%, was unchanged from August, while the employment-population ratio rose 0.2 percentage point to 60.2%. In September, average hourly earnings increased by $0.13, or 0.4%, to $35.36. Since September 2023, average hourly earnings rose by 4.0%. The average workweek edged down 0.1 hour to 34.2 hours.
There were 216,000 initial claims for unemployment insurance for the week ended October 26, 2024. During the same period, the total number of workers receiving unemployment insurance was 1,862,000. A year ago, there were 216,000 initial claims, while the total number of workers receiving unemployment insurance was 1,816,000.
FOMC/interest rates: The Federal Open Market Committee did not meet in October. It next meets during the week of November 8. While the PCE price index continued to move closer to the Fed’s 2.0% target, the core annual rate (2.7%) remained relatively elevated. The Fed is not likely to reverse course and raise interest rates based on this information (in addition to moderate economic and job growth). By the same token, Fed governors may be hesitant to lower rates in November.
GDP/budget: According to the initial estimate from the Bureau of Economic Analysis, the economy, as measured by gross domestic product, accelerated at an annualized rate of 2.8% in the third quarter of 2024. GDP increased 3.0% in the second quarter. Personal consumption expenditures rose 3.7% in the third quarter compared to a 2.8% increase in the previous quarter. Consumer spending on goods rose 6.0%, while spending on services advanced 2.6%. Personal consumption expenditures (2.46%) contributed the most to overall economic growth. Gross domestic investment advanced 0.3% in the third quarter, well below the 8.3% increase in the second quarter. Nonresidential (business) fixed investment advanced 3.3% in the third quarter (3.9% in the second quarter), while residential fixed investment declined 5.1%, compared to a 2.8% decrease in the second quarter. Exports climbed 8.9%, while imports, which are a negative in the calculation of GDP, increased 11.2%. Consumer prices, as measured by the personal consumption expenditures price index, increased 1.5%, compared with an increase of 2.5% in the second quarter. Excluding food and energy prices, the PCE price index increased 2.2%, compared with an increase of 2.8% in the prior quarter.
September was the last month of the fiscal year for the federal government. In September, the federal budget statement showed a surplus $64.3 billion versus a deficit of $170.7 billion a year ago. In September, government receipts totaled $527.6 billion, while government outlays were $463.4 billion. For fiscal year 2024, the total deficit $1,832.8 trillion, which was roughly $137.6 billion more than the deficit from the previous fiscal year. For FY24, total receipts were $4,918.7 trillion and total expenditures were $6,751.6 trillion. Individual income tax receipts for FY 24 totaled $2,426.1 trillion, while corporate income tax receipts were $529.9 billion. Social Security payments were estimated at $1,461.0 trillion, accounted for the largest outlays for the fiscal year.
Inflation/consumer spending: The PCE price index ticked up 0.2% in September after increasing 0.1% in August and was in line with expectations. Prices for goods decreased 0.1%, while prices for services increased 0.3%. Food prices increased 0.4%, while energy prices decreased 2.0%. Excluding food and energy, the PCE price index increased 0.3%. The 12-month PCE price index for September increased 2.1%, the lowest annual rate since February 2021. Prices for goods decreased 1.2% although prices for services increased 3.7%. Food prices increased 1.2%, while energy prices decreased 8.1%. Excluding food and energy, the PCE price index increased 2.7% from one year ago. Also in September, both personal income and disposable (after-tax) personal income rose 0.3%. Personal consumption expenditures, a measure of consumer spending, increased 0.5%.
The Consumer Price Index rose 0.2% in September, the same increase as in August and July. Over the 12 months ended in September, the CPI rose 2.4%, down 0.1 percentage point from the 12-month period ended in August. This was the smallest 12-month increase since February 2021. Excluding food and energy, the CPI rose 0.3% in September, unchanged from the previous month’s total, and 3.3% from September 2023. Shelter prices rose 0.2% in September and prices for food increased 0.4%. Together, these two components contributed over 75% of the monthly all items increase. Since September 2023, shelter prices have risen 4.9%, while food prices increased 2.3%. Energy prices were down 1.9% in September and 6.8% lower than a year ago. Much of the decrease in energy prices was from a 4.1% decline in gasoline prices.
The Producer Price Index was flat in September after ticking up 0.2% in August. In September, a 0.2% increase in prices for services offset a 0.2% decline in prices for goods. For the 12 months ended in September, producer prices advanced 1.8%.
Housing: Sales of existing homes declined 1.0% in September and 3.5% over the last 12 months. According to the National Association of Realtors® (NAR), the market for existing homes remained sluggish but lower mortgage rates and increased inventory should help spur sales moving forward. Unsold inventory of existing homes in September represented a 4.3-month supply at the current sales pace, up 1.5% from the August estimate. The median existing-home price fell 2.4% in September to $404,500, but was 3.0% above the September 2023 price of $392,700. Sales of existing single-family homes decreased 0.6% in September and were down 2.3% from a year ago. The median existing single-family home price was $409,000 in September, down from $419,000 in August but above the September 2023 estimate of $397,400.
New single-family home sales increased 4.1% in September and were 6.3% higher than the September 2023 rate. The median sales price of new single-family houses sold in July was $426,300 ($410,900 in August). The September average sales price was $501,000 ($486,500 in August). The inventory of new single-family homes for sale in September represented a supply of 7.6 months at the current sales pace, down from 7.9 months in August.
Manufacturing: Industrial production decreased 0.3% in September after advancing 0.3% in the prior month. A strike at a major producer of civilian aircraft held down total growth by an estimated 0.3% in September, and the effects of two hurricanes subtracted an estimated 0.3%. Manufacturing output declined 0.4% in September and was 0.5% below its year-earlier level. Mining output fell 0.6%, while utilities rose 0.7%. For the 12 months ended in September, total industrial production moved down 0.6% from its year-earlier level. Over the same period, manufacturing decreased 0.7%, mining declined 2.2%, while utilities advanced 0.6%.
New orders for durable goods declined 0.8% in September, following a 0.8% decrease in August. Excluding transportation, new orders increased 0.4%. Excluding defense, new orders decreased 1.1%. Transportation equipment, down three of the last four months, drove the overall decrease, falling 3.1%. New orders for nondefense capital goods in September decreased 4.5%. New orders for defense capital goods in September rose 6.4%.
Imports and exports: U.S. import prices receded 0.4% in September following a 0.2% decrease in August. The September decline in imports was the largest monthly drop since the index decreased 0.7% in December 2023. Prices for import fuel fell 7.0% in September, after declining 2.9% in August. Excluding fuel, import prices ticked up 0.1% in September. The August drop was the largest one-month decline since the index fell 8.0% in December 2023. Prices for nonfuel imports edged down 0.1% in August. Import prices edged down 0.1% over the past year, the first 12-month drop since February 2024. Prices for U.S. exports fell 0.7% in September, after advancing 0.9% the previous month. Lower prices for nonagricultural exports in September more than offset higher agricultural export prices. Export prices declined 2.1% over the past year, the largest 12-month decrease since January 2024.
The international trade in goods deficit was $108.2 billion in September, up 14.9%, or $14.0 billion, from the August estimate. Exports of goods for September were $174.2 billion, $3.6 billion, or 2.9% more than August exports. Imports of goods for September were $258.4 billion, $10.4 billion, or 1.4% less than August imports.
The latest information on international trade in goods and services, released October 8, was for August and revealed that the goods and services trade deficit was $70.4 billion, up $8.5 billion, or 10.8%, from the July deficit. August exports were $271.8 billion, $5.3 billion, or 2.0%, more than July exports. August imports were $342.2 billion, $3.2 billion, or 0.9% less than July imports. Year to date, the goods and services deficit increased $47.1 billion, or 8.9%, from the same period in 2023. Exports increased $79.0 billion, or 3.9%. Imports increased $126.1 billion, or 4.9%.
International markets: Annual inflation in the eurozone grew to 2.0% in October, up from 1.7% in September. The marginal increase was expected as last year’s declines in energy prices are no longer factored into annual rates. In the United Kingdom, the annual inflation rate in September fell to 1.7%, the lowest since April 2021. China’s annual inflation rate was estimated at 0.4% in September, below expectations and under August’s figure of 0.6%. Canada’s GDP grew by 0.3% in September, ending the third quarter with a 0.2% increase. For October, the STOXX Europe 600 Index dipped 2.3%; the United Kingdom’s FTSE fell 2.3%; Japan’s Nikkei 225 Index gained 1.4%; while China’s Shanghai Composite Index declined 1.7%.
Consumer confidence: Consumer confidence rose in October to 108.7, up from 99.2 in September, according to the Conference Board Consumer Confidence Index®. The Present Situation Index, based on consumers’ assessment of current business and labor market conditions, increased by 14.2 points to 138.0 in October. The Expectations Index, based on consumers’ short-term outlook for income, business, and labor market conditions, increased to 89.1 in October, up from 82.8 in September.
Eye on the Month Ahead
All attention will be focused on the results of the presidential and congressional elections in early November. In addition, the Federal Reserve meets this month. After lowering the federal funds target rate range by 50.0 basis points in September, it is questionable whether an additional decrease is in the offing in November. However, the Fed meets again in December and may consider an interest rate adjustment at that time.
Tech shares helped the NASDAQ close up last week. The remaining indexes listed here didn’t fare as well. Renewed concerns about the Federal Reserve’s interest rate policy dampened investor appetite for risk. Bond prices also faded during the week, driving yields higher. Crude oil prices climbed higher as investors monitored ongoing tensions in the Middle East. Gold prices continued to advance and have risen over 33.0% from the beginning of the year.
Stocks mostly retreated last Monday following their longest weekly rally of the year. Of the benchmark indexes listed here, only the NASDAQ (0.3%) posted a gain. The remaining indexes closed in the red, led by the Russell 2000 (-1.6%), followed by the Dow and the Global Dow (-0.8%). The S&P 500 dipped 0.2%. Ten-year Treasury yields rose 10.9 basis points to close at 4.18%, the highest level since late July. Among the market sectors, utilities, materials, financials, real estate, and information technology closed higher, while health care and energy declined. Crude oil prices closed up 1.8% to $70.45 per barrel. The dollar (0.5%) and gold prices (0.2%) posted gains.
In what was akin to the previous day’s performance, stocks closed mostly lower last Tuesday. Once again, the NASDAQ was the only benchmark index to post a gain after ticking up 0.2%, while the Dow and the S&P 500 were essentially unchanged. The Global Dow fell 0.4%, and the Russell 2000 declined 0.3%. The yield on 10-year Treasuries inched up to 4.20%. Crude oil prices jumped 2.4% to settle at $72.24 per barrel. The dollar inched up 0.1%, while gold prices rose 0.9%.
Each of the benchmark indexes listed here retreated last Wednesday as bond yields rose amid investor concerns over further interest rate cuts. Several major tech companies saw their stock values decline, which also placed a drag on Wall Street. The Nasdaq dropped 1.6%, the Dow fell 1.0%, the S&P 500 declined 0.9%, the Russell 2000 lost 0.8%, and the Global Dow dipped 0.6%. Bond values also tumbled, pushing yields higher, with 10-year Treasury yields climbing 3.8 basis points to close the session at 4.24%. Crude oil prices fell 1.0%, falling to $71.03 per barrel. The dollar ticked up 0,3%, while gold prices declined 1.1%.
Stocks closed mostly higher last Thursday with only the Dow (-0.3%) sliding lower. Investors reacted to the latest earnings reports, particularly one involving a major electric automotive manufacturer. The NASDAQ rose 0.8%, the S&P 500 ended a three-session slide after gaining 0.2%. The Russell 2000 also edged up 0.2%, while the Global Dow inched up 0.1%. Ten-year Treasury yields fell to 4.20%. Crude oil prices retreated for the second straight day, settling at $70.47 per barrel. The dollar edged lower, while gold prices (0.7%) recouped some of the losses from the previous session.
Gains in tech shares helped drive the NASDAQ (0.6%) higher last Friday. A decline in financial shares was enough to overshadow tech gains, resulting in losses for the Dow (-0.6%), the Russell 2000 (-0.5%), and the Global Dow (-0.4%). The S&P 500 ended the session flat. Ten-year Treasury yields climbed to 4.23%. Crude oil prices reversed losses from the previous two days, advancing 2.1%. The dollar and gold prices each gained 0.2%.
Stock Market Indexes
Market/Index
2023 Close
Prior Week
As of 10/25
Weekly Change
YTD Change
DJIA
37,689.54
43,275.91
42,114.40
-2.68%
11.74%
NASDAQ
15,011.35
18,489.55
18,518.61
0.16%
23.36%
S&P 500
4,769.83
5,864.67
5,808.12
-0.96%
21.77%
Russell 2000
2,027.07
2,276.09
2,207.99
-2.99%
8.93%
Global Dow
4,355.28
5,043.43
4,939.32
-2.06%
13.41%
fed. funds target rate
5.25%-5.50%
4.75%-5.00%
4.75%-5.00%
0 bps
-50 bps
10-year Treasuries
3.86%
4.07%
4.23%
16 bps
37 bps
US Dollar-DXY
101.39
103.46
104.32
0.83%
2.89%
Crude Oil-CL=F
$71.30
$69.35
$71.59
3.23%
0.41%
Gold-GC=F
$2,072.50
$2,736.90
$2,757.40
0.75%
33.05%
Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.
Last Week’s Economic News
September, the last month of the fiscal year, saw the government budget enjoy a surplus of $64.3 billion, well off from August’s deficit of $380.1 billion. For fiscal year 2024, the deficit was $1,832.8 trillion, $137.6 billion above the FY23 deficit of $1,695.2 trillion. Compared to the prior fiscal year, FY24 saw government receipts increase by roughly $479.5 billion, while government outlays increased by $617.0 billion.
New orders for manufactured durable goods in September, down three of the last four months, decreased 0.8%, according to the U.S. Census Bureau. This followed a 0.8% August decrease. Excluding transportation, new orders increased 0.4%. Excluding defense, new orders decreased 1.1%. Transportation equipment, also down three of the last four months, drove the decrease after declining 3.1%. New orders for nondefense capital goods in September decreased 4.5%. New orders for defense capital goods rose 6.4% last month. Since September 2023, new orders for durable goods have decreased 1.5%.
Existing-home sales decreased 1.0% in September and 3.5% from one year ago. The median existing-home sales price fell 2.4% in September to $404,500 but was 3.0% above the September 2023 price. The inventory of unsold existing homes, at a supply of 4.3 months, rose by 1.5% from the prior month. Sales of single-family homes edged lower by 0.6% in September and fell 2.3% from a year earlier. The median existing single-family home price was $409,000 in September, down from $419,000 in August but up from $397,400 in September 2023. According to Freddie Mac, the 30-year fixed-rate mortgage averaged 6.44% as of October 17. That’s up from 6.32% from one week ago but down from 7.63% one year ago.
Sales of new single-family homes in September reached the highest level since May 2023 after rising 4.1% over the prior month’s total. Last month’s sales were 6.3% above the September 2023 estimate. The median sales price of new homes sold in September 2024 was $426,300. The average sales price was $501,000. The estimate of new homes for sale at the end of September represented a supply of 7.6 months at the current sales rate.
The national average retail price for regular gasoline was $3.144 per gallon on October 21, $0.027 per gallon below the prior week’s price and $0.389 per gallon less than a year ago. Also, as of October 21, the East Coast price rose $0.012 to $3.054 per gallon; the Midwest price decreased $0.094 to $3.006 per gallon; the Gulf Coast price inched down $0.015 to $2.720 per gallon; the Rocky Mountain price dipped $0.037 to $3.221 per gallon; and the West Coast price fell $0.013 to $4.034 per gallon.
For the week ended October 19, there were 227,000 new claims for unemployment insurance, a decrease of 15,000 from the previous week’s level, which was revised up by 1,000. According to the Department of Labor, the advance rate for insured unemployment claims for the week ended October 12 was 1.3%, an increase of 0.1 percentage point from the previous week’s rate. The advance number of those receiving unemployment insurance benefits during the week ended October 5 was 1,897,000, an increase of 28,000 from the previous week’s level, which was revised up by 2,000. This is the highest level for insured unemployment since November 13, 2021 when it was 1,974,000. States and territories with the highest insured unemployment rates for the week ended October 5 were New Jersey (2.2%), California (1.9%), Puerto Rico (1.9%), Washington (1.8%), Nevada (1.6%), Rhode Island (1.6%), Massachusetts (1.5%), New York (1.5%), Illinois (1.4%), Alaska (1.3%), Oregon (1.3%), and Pennsylvania (1.3%). The largest increases in initial claims for unemployment insurance for the week ended October 12 were in Georgia (+3,293), New York (+2,340), Pennsylvania (+1,379), Texas (+886), and South Carolina (+779), while the largest decreases were in Michigan (-7,917), Florida (-3,257), Ohio (-2,556), North Carolina (-2,365), and Indiana (-2,173).
Eye on the Week Ahead
There are several market-moving economic reports released this week. Among those reports is the initial estimate of gross domestic product for the third quarter. The second quarter GDP estimated that the economy grew at an annualized rate of 3.0%. The personal consumption expenditures price index, the preferred inflation indicator of the Federal Reserve, is released within the personal income and outlays report. August saw prices tick up 0.1%, while the annual rate of growth rose 2.2%. Lastly, the latest employment data for October is released on Friday. September’s report revealed an unexpected 254,000 new jobs, a figure well above consensus estimates. It is likely that the September figure is adjusted downward.
Wall Street marked another week of gains, with each of the benchmark indexes climbing higher. The Dow and the S&P 500 attained new records, while the NASDAQ rode a spurt in tech and communication shares. Nine of the 11 market sectors closed the week higher, led by utilities, financials, and real estate. Health care and energy declined. Gold prices also reached new record highs, driven by global demand for safer assets and expectations of further interest rate cuts by major central banks. Crude oil prices declined, marking the largest weekly drop since the beginning of September. Weaker demand and slowing economic growth in China drove the downturn in crude oil prices.
The Dow and the S&P 500 achieved fresh highs last Monday as corporate earnings season kicked into high gear. The NASDAQ climbed 0.9% behind a strong performance by tech shares. The S&P 500 rose 0.8%, the Russell 2000 added 0.6%, the Dow advanced 0.5%, and the Global Dow gained 0.4%. Crude oil prices fell 2.1% to $73.98 per barrel as OPEC+ cut the outlook for demand. The dollar rose 0.3%, while gold prices fell 0.2%. The bond market was closed for the holiday.
Last Monday’s rally didn’t carry over to Tuesday. Each of the benchmark indexes listed here closed sharply lower as weak corporate earnings from a large chipmaker led to a broad selloff in tech shares. The NASDAQ lost 1.0%, while the Dow and the S&P 500 fell 0.8%. The Global Dow dipped 0.6%. The small caps of the Russell 2000 ticked up 0.1%. Ten-year Treasury yields closed at 4.03%, a 0.6-basis-point decline. Crude oil prices dropped 4.0% to $70.90 per barrel. The dollar was flat, while gold prices rose 0.4%.
Stocks closed higher last Wednesday, with the Dow reaching another record high. The Russell 2000 gained 1.6%, followed by the Dow (0.8%), the S&P 500 (0.5%), the NASDAQ (0.3%), and the Global Dow (0.1%). Utilities and financials led the market sectors, while communication services and consumer staples declined. Yields on 10-year Treasuries slipped to 4.01%. Crude oil prices decreased for the third straight day, closing at $70.49 per barrel. The dollar and gold prices increased.
Last Thursday saw stocks close with mixed results. The Dow rose 0.4%, notching another record, the Global Dow inched up 0.1%, and the NASDAQ gained less than 0.1%. The Russell 2000 lost 0.3%, and the S&P 500 closed marginally lower. Ten-year Treasury yields climbed 0.8 basis points to 4.09%. Crude oil prices ended a downward trend, gaining 0.5% to settle at $70.76 per barrel. The dollar gained 0.2%, and gold prices rose 0.6%.
Stocks ended last Friday’s session mostly higher as the S&P 500 (0.4%) and the Dow (0.1%) recorded new highs. The tech-heavy NASDAQ gained 0.6%, and the Global Dow rose 0.4%. The Russell 2000 fell 0.2%. Positive earnings data and a surge in Megacaps helped drive the market higher. Yields on 10-year Treasuries slipped to 4.07%. Crude oil gave back the previous day’s gains after falling 1.9%. The dollar declined 0.3%, while gold prices rose 1.1%.
Stock Market Indexes
Market/Index
2023 Close
Prior Week
As of 10/18
Weekly Change
YTD Change
DJIA
37,689.54
42,863.86
43,275.91
0.96%
14.82%
NASDAQ
15,011.35
18,342.94
18,489.55
0.80%
23.17%
S&P 500
4,769.83
5,815.03
5,864.67
0.85%
22.95%
Russell 2000
2,027.07
2,234.41
2,276.09
1.87%
12.28%
Global Dow
4,355.28
5,022.79
5,043.43
0.41%
15.80%
fed. funds target rate
5.25%-5.50%
4.75%-5.00%
4.75%-5.00%
0 bps
-50 bps
10-year Treasuries
3.86%
4.09%
4.07%
-2 bps
21 bps
US Dollar-DXY
101.39
102.93
103.46
0.51%
2.04%
Crude Oil-CL=F
$71.30
$75.66
$69.35
-8.34%
-2.73%
Gold-GC=F
$2,072.50
$2,672.40
$2,736.90
2.41%
32.06%
Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.
Last Week’s Economic News
In September, retail and food services sales rose 0.4% from the previous month and increased 1.7% from a year earlier. Retail trade sales climbed 0.3% in September and 1.4% from last year. Nonstore (online) retail sales advanced 0.4% last month and 7.1% from September 2023. Gasoline station sales fell 1.6% in September and were down 10.7% for the year.
Industrial production decreased 0.3% in September after advancing 0.3% in August. A strike at a major producer of civilian aircraft and the effect of two hurricanes impacted industrial production in September. Manufacturing output fell 0.4% last month, and mining dropped 0.6%. Utilities gained 0.7%. Total industrial production in September was 0.6% below its year-earlier level.
Prices for U.S. imports declined 0.4% in September following a 0.2% decrease the previous month, according to the U.S. Bureau of Labor Statistics. Lower fuel prices in September more than offset higher nonfuel prices. U.S. export prices fell 0.7% in September, after declining 0.9% in August. Import prices edged down 0.1% over the past year, the first 12-month drop since February 2024. Export prices declined 2.1% over the past year, the largest 12-month decrease since January 2024.
The number of issued building permits declined 2.9% in September and was 5.7% below the September 2023 rate. Single-family authorizations in September were 0.3% above the revised August figure. Privately-owned housing starts in September were 0.5% below the revised August estimate and were 0.7% below the September 2023 rate. Single-family housing starts in September were 2.7% above the revised August figure. Privately-owned housing completions in September were 5.7% below the revised August estimate but 14.6% above the September 2023 rate. Single-family housing completions in September were 2.7% below the revised August rate.
The national average retail price for regular gasoline was $3.171 per gallon on October 14, $0.035 per gallon above the prior week’s price but $0.405 per gallon less than a year ago. Also, as of October 14, the East Coast price rose $0.033 to $3.042 per gallon; the Midwest price increased $0.064 to $3.100 per gallon; the Gulf Coast price inched up $0.010 to $2.735 per gallon; the Rocky Mountain price dipped $0.013 to $3.258 per gallon; and the West Coast price increased $0.020 to $4.047 per gallon.
For the week ended October 12, there were 241,000 new claims for unemployment insurance, a decrease of 19,000 from the previous week’s level, which was revised up by 2,000. According to the Department of Labor, the advance rate for insured unemployment claims for the week ended October 5 was 1.2%, unchanged from the previous week’s rate. The advance number of those receiving unemployment insurance benefits during the week ended October 5 was 1,867,000, an increase of 9,000 from the previous week’s level, which was revised down by 3,000. States and territories with the highest insured unemployment rates for the week ended September 28 were New Jersey (2.2%), California (2.0%), Puerto Rico (1.8%), Rhode Island (1.8%), Washington (1.8%), Nevada (1.6%), Massachusetts (1.5%), New York (1.5%), Illinois (1.4%), Connecticut (1.3%), and Pennsylvania (1.3%). The largest increases in initial claims for unemployment insurance for the week ended October 5 were in Michigan (+9,389), North Carolina (+8,714), Ohio (+4,648), California (+4,068), and Florida (+4,021), while the largest decreases were in Wyoming (-24), Idaho (-21), Louisiana (-13), Massachusetts (-12), and Alaska (-10).
Eye on the Week Ahead
The September figures for sales of existing and new homes are available this week. Both markets saw a slip in sales in August. However, with mortgage rates slowly decreasing and inventory increasing, sales should pick up some steam throughout the remainder of the year.
Despite a tepid start, stocks ended last week generally higher. Each of the benchmark indexes listed here posted solid gains with the Dow and the S&P 500 reaching record highs on multiple occasions. Financials and information technology led the market sectors, with consumer discretionary, real estate, communication services, utilities, and energy losing ground. Crude oil prices rose for the second straight week, fueled by escalating tensions in the Middle East and increased fuel demand in Florida on the heels of Hurricane Milton. The dollar and gold prices increased.
Wall Street began the week tumbling lower as investors pondered a further escalation of tensions in the Middle East. All of the benchmark indexes listed here lost value, with the NASDAQ falling 1.2% followed by the S&P 500, which dropped 1.0%. The Dow and the Russell 2000 lost 0.9%, while the Global Dow dipped 0.1%. Long-term bond values also declined, with yields on 10-year Treasuries climbing to 4.02%, the highest since late July, as the strong labor report dampened any chance of another interest rate cut in November. Crude oil prices climbed to $77.38 per barrel, a six-week high, based on fears that a broader conflict in the Middle East could include strikes on Iran’s oil fields. The dollar and gold prices marginally decreased.
Last Tuesday saw stocks rebound, driven by a rally in tech shares. The NASDAQ added 1.5%, the S&P 500 rose 1.0%, the Dow climbed 0.3%, and the Russell 2000 eked out a 0.1% gain. The Global Dow fell 0.5%. Ten-year Treasury yields ticked up to 4.03%. The dollar slipped 0.1%, while gold prices fell 0.9%. Crude oil prices tumbled 4.2% to $73.90 per barrel.
Both the Dow (1.0%) and the S&P 500 (0.7%) climbed to new record highs last Wednesday, ahead of the Consumer Price Index report for September. Investors and forecasters expect the latest data to show that inflation slowed in September. The NASDAQ gained 0.6%, the Global Dow rose 0.4%, and the Russell 2000 inched up 0.3%. Ten-year Treasury yields continued to advance, closing at 4.06%. Crude oil prices slipped 0.2%, settling at $73.46 per barrel. The dollar increased 0.4%, while gold prices fell 0.3%.
Stocks closed slightly lower last Thursday as investors mulled the latest Consumer Price Index, which slowed to its lowest rate since the beginning of 2021, but marginally exceeded market expectations (see below). The Russell 2000 fell 0.6% and the S&P 500 lost 0.2%. The NASDAQ, the Dow, and the Global Dow all declined 0.1% or less. Ten-year Treasury yields ticked up 2.9 basis points to 4.09%. Crude oil prices, driven by rising U.S. demand in the aftermath of Hurricanes Helene and Milton, gained 3.7%, settling at $75.93 per barrel. The dollar fell 0.1%, while gold prices rose 0.8% to $2,647.00 per ounce after sliding to a three-week low in the prior session.
Last Friday saw both the Dow and the S&P 500 reach new record highs. Stocks closed generally higher to end the week as third-quarter earnings season got off on the right foot, with some major banks reporting stronger-than-expected results. The small caps of the Russell 2000 gained 2.1%, the Dow rose 1.0%, the S&P 500 added 0.6%, the Global Dow climbed 0.5%, and the NASDAQ advanced 0.3%. The yield on 10-year Treasuries rose to 4.11% during the session, only to slip back to 4.09%. Crude oil prices fell 0.4%, the dollar slid 0.1%, while gold prices moved up 1.3%.
Stock Market Indexes
Market/Index
2023 Close
Prior Week
As of 10/11
Weekly Change
YTD Change
DJIA
37,689.54
42,352.75
42,863.86
1.21%
13.73%
NASDAQ
15,011.35
18,137.85
18,342.94
1.13%
22.19%
S&P 500
4,769.83
5,751.07
5,815.03
1.11%
21.91%
Russell 2000
2,027.07
2,212.80
2,234.41
0.98%
10.23%
Global Dow
4,355.28
5,006.95
5,022.79
0.32%
15.33%
fed. funds target rate
5.25%-5.50%
4.75%-5.00%
4.75%-5.00%
0 bps
-50 bps
10-year Treasuries
3.86%
3.98%
4.09%
11 bps
23 bps
US Dollar-DXY
101.39
102.48
102.93
0.44%
1.52%
Crude Oil-CL=F
$71.30
$74.59
$75.66
1.43%
6.12%
Gold-GC=F
$2,072.50
$2,671.10
$2,672.40
0.05%
28.95%
Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.
Last Week’s Economic News
The Consumer Price Index rose 0.2% in September, the same increase as in August and July. Prices for shelter rose 0.2% in September and prices for food rose 0.4%. Together, they contributed over 75% of the monthly all items increase. Consumer prices, less food and energy rose 0.3% in September, the same increase as in August. Energy prices fell 1.9% last month after declining 0.8% in August. The all items index rose 2.4% for the 12 months ended September, the smallest 12-month increase since February 2021. Prices less food and energy rose 3.3% over the last 12 months.
The Producer Price Index was unchanged in September after advancing 0.2% in August. For the year, producer prices rose 1.8%. In September, prices for services rose 0.2% but were offset by a 0.2% decline in prices for goods. Producer prices less foods, energy, and trade services inched up 0.1% in September after rising 0.2% in August. For the 12 months ended in September, prices less foods, energy, and trade services increased 3.2%.
The report on international trade in goods and services, released October 8, revealed that the trade deficit in August was $70.4 billion, down $8.5 billion, or 10.8%, from the July estimate. August exports were $271.8 billion, $5.3 billion, or 2.0%, more than July exports. August imports were $342.2 billion, $3.2 billion, or 0.9%, less than July imports. Year to date, the goods and services deficit increased $47.1 billion, or 8.9%, from the same period in 2023. Exports increased $79.0 billion, or 3.9%. Imports increased $126.1 billion, or 4.9%.
The national average retail price for regular gasoline was $3.136 per gallon on October 7, $0.043 per gallon below the prior week’s price and $0.548 per gallon less than a year ago. Also, as of October 7, the East Coast price fell $0.051 to $3.009 per gallon; the Midwest price decreased $0.069 to $3.036 per gallon; the Gulf Coast price rose $0.030 to $2.725 per gallon; the Rocky Mountain price dipped $0.144 to $3.271 per gallon; and the West Coast price decreased $0.015 to $4.027 per gallon.
For the week ended October 5, there were 258,000 new claims for unemployment insurance, an increase of 33,000 from the previous week’s level. This is the highest level for initial claims since August 5, 2023. According to the Department of Labor, the advance rate for insured unemployment claims for the week ended September 28 was 1.2%, unchanged from the previous week’s rate. The advance number of those receiving unemployment insurance benefits during the week ended September 28 was 1,861,000, an increase of 42,000 from the previous week’s level, which was revised down by 7,000. States and territories with the highest insured unemployment rates for the week ended September 21 were New Jersey (2.2%), California (2.0%), Puerto Rico (1.9%), Rhode Island (1.8%), Washington (1.7%), Nevada (1.6%), Massachusetts (1.5%), New York (1.5%), Illinois (1.4%), Connecticut (1.3%), and Pennsylvania (1.3%). The largest increases in initial claims for unemployment insurance for the week ended September 28 were in Michigan (+1,187), Washington (+892), Indiana (+657), California (+638), and Iowa (+568), while the largest decreases were in Georgia (-1,237), Florida (-919), Texas (-532), Virginia (-481), and New York (-451).
Eye on the Week Ahead
The report on import and export prices for September is available this week. August saw a decrease in both import and export prices. The retail sales report for September is also out this week. Retail and food services sales ticked up 0.1% in August, beating expectations of forecasters. Industrial production rebounded in August after lagging in July. Finally, the September report on housing starts, building permits, and housing completions is released this week. Receding mortgage rates have renewed builder confidence, which led to a rise in building permits and housing starts in August.
Investors were confronted with plenty of market-moving information last week as they waded through negative developments and some positive signs. Growing tensions in the Middle East and a slowdown in the manufacturing sector (see below) were causes for concern, while a better-than-expected jobs report (see below) helped alleviate some of those worries, at least for a time. The S&P 500, the NASDAQ, and the Dow ended a very volatile week on the plus side, while the Russell 2000 and the Global Dow closed the week lower. Among the market sectors, energy surged by more than 8.5%, while communication services, financials, and industrials also closed higher. The remaining sectors declined, led by real estate and materials. Ten-year Treasury yields surged to their highest level in nearly two months as the robust labor report cooled expectations that the Federal Reserve needed to aggressively cut interest rates.
The stock market spent most of last Monday in negative territory, facing selling pressures, only to rally at the close of the session. The S&P 500 and the NASDAQ each gained 0.4%, the Russell 2000 added 0.2%, while the Dow was flat. The Global Dow declined 0.5%. Ten-year Treasury yields rose 5.3 basis points to settle at 3.80%. Crude oil prices inched up 0.1% to $68.24 per barrel. The dollar and gold prices fell marginally.
Stocks slid lower last Tuesday amid rising tensions in the Middle East. Investors also had to consider a slowdown in manufacturing activity (see below), although job openings rose unexpectedly in August, evidencing that the lag in the labor market may not be quite so pronounced. All of the benchmark indexes listed here lost value, led by the Russell 2000 and the NASDAQ, each of which declined 1.5%. The S&P 500 fell 0.9%, the Global Dow dipped 0.5%, and the Dow slid 0.4%. Crude oil prices rose 3.6%, reaching $70.64 per barrel. Ten-year Treasury yields fell 5.9 basis points to 3.74%. The dollar rose 0.4% against a basket of currencies, while gold prices advanced 0.8%.
The benchmark indexes listed here closed mostly higher last Wednesday, with the exception of the Russell 2000 and the Global Dow, each of which slipped 0.1% lower. The S&P 500, the Dow, and the NASDAQ inched up by about 0.1%. Ten-year Treasury yields rose to 3.78%. Crude oil prices continued to advance, settling at $70.90 per barrel. The dollar gained 0.4%, while gold prices fell 0.4%.
Stocks closed lower last Thursday as escalating tensions in the Middle East and the dock workers’ strike were concerns for investors. The small caps of the Russell 2000 led the declines, falling 0.7%, followed by the Global Dow (-0.6%), the Dow (-0.4%), and the S&P 500 (-0.2%). The NASDAQ dipped less than 0.1%. Crude oil prices vaulted 5.3%, reaching $73.82 per barrel. Ten-year Treasury yields rose 6.5 basis points to 3.85%. The dollar and gold prices each rose 0.3%.
Last Friday saw stocks move higher on the heels of a strong jobs report, which quelled, at least temporarily, investors’ concerns over Middle East tensions. The Russell 2000 gained 1.5%, followed by the NASDAQ (1.2%), the S&P 500 (0.9%), and the Dow (0.8%), which reached another record high. The Global Dow rose 0.6%. Yields on 10-year Treasuries vaulted 13.1 basis points to close at 3.98% as bond prices declined. Crude oil prices gained 1.0%, the dollar advanced 0.5%, while gold prices slid 0.3%.
Stock Market Indexes
Market/Index
2023 Close
Prior Week
As of 10/4
Weekly Change
YTD Change
DJIA
37,689.54
42,313.00
42,352.75
0.09%
12.37%
NASDAQ
15,011.35
18,119.59
18,137.85
0.10%
20.83%
S&P 500
4,769.83
5,738.17
5,751.07
0.22%
20.57%
Russell 2000
2,027.07
2,224.70
2,212.80
-0.53%
9.16%
Global Dow
4,355.28
5,064.45
5,006.95
-1.14%
14.96%
fed. funds target rate
5.25%-5.50%
4.75%-5.00%
4.75%-5.00%
0 bps
-50 bps
10-year Treasuries
3.86%
3.74%
3.98%
24 bps
12 bps
US Dollar-DXY
101.39
100.39
102.48
2.08%
1.08%
Crude Oil-CL=F
$71.30
$68.57
$74.59
8.78%
4.61%
Gold-GC=F
$2,072.50
$2,674.90
$2,671.10
-0.14%
28.88%
Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.
Last Week’s Economic News
The employment sector showed major signs of life in September. Total employment expanded by 254,000 last month, exceeding expectations and well above the 12-month average of 203,000. The September increase follows upward revisions to both the July and August estimates, which combined were 72,000 higher than previously reported. The unemployment rate, at 4.1%, ticked down 0.1 percentage point from August, while the number of unemployed decreased by 281,000 to 6.8 million. The labor force participation rate was unchanged at 62.7%, while the employment-population ratio rose 0.2 percentage point to 60.2%. The number of unemployed for at least 27 weeks increased by 97,000 to 1.6 million. In September, the long-term unemployed accounted for 23.7% of all unemployed people. In September, average hourly earnings increased by $0.13, or 0.4%, to $35.36. Over the past 12 months, average hourly earnings have increased by 4.0%. The average workweek edged down by 0.1 hour to 34.2 hours in September.
According to the S&P Global survey of purchasing managers, the manufacturing sector moved deeper into contraction in September. The S&P Global US Manufacturing Purchasing Managers’ Index™ remained below the 50.0 no-change mark in September, dipping to 47.3 from 47.9 in August. The manufacturing sector regressed for three consecutive months, with September’s reading the most pronounced decline since June 2023. Central to the drop in manufacturing was a sharp fall in new orders amid a slowdown in the overall economy, and uncertainty around the upcoming presidential election.
While the manufacturing sector may be waning, the services sector is showing strength. A reduction in interest rates helped increase new orders and boost services activity in September, according to the latest S&P Global survey of purchasing managers. New business continued to rise solidly, leading to a build-up of unfinished work as companies were cautious with regards to hiring in the face of strong cost pressures. In fact, input prices rose at the joint-fastest pace in a year, with selling price inflation also accelerating. The S&P Global US Services PMI® Business Activity Index posted 55.2 in September, down from 55.7 in August but still a marked monthly increase in the services sector, which has now increased in each of the last 20 months.
The number of job openings increased in August, according to the latest data from the Job Openings and Labor Turnover Summary. At roughly 8.0 million, job openings increased by 329,000. The number of hires was essentially unchanged at 5.3 million, while total separations, at 5.0 million, declined by 317,000.
The national average retail price for regular gasoline was $3.179 per gallon on September 30, $0.006 per gallon below the prior week’s price and $0.619 per gallon less than a year ago. Also, as of September 30, the East Coast price rose $0.008 to $3.060 per gallon; the Midwest price increased $0.028 to $3.105 per gallon; the Gulf Coast price fell $0.038 to $2.695 per gallon; the Rocky Mountain price dipped $0.019 to $3.415 per gallon; and the West Coast price decreased $0.069 to $4.042 per gallon.
For the week ended September 28, there were 225,000 new claims for unemployment insurance, an increase of 6,000 from the previous week’s level, which was revised up by 1,000. According to the Department of Labor, the advance rate for insured unemployment claims for the week ended September 21 was 1.2%, unchanged from the previous week’s rate. The advance number of those receiving unemployment insurance benefits during the week ended September 21 was 1,826,000, a decrease of 1,000 from the previous week’s level, which was revised down by 7,000. States and territories with the highest insured unemployment rates for the week ended September 14 were New Jersey (2.3%), California (2.0%), Puerto Rico (1.9%), Rhode Island (1.8%), Washington (1.7%), Nevada (1.6%), Illinois (1.5%), Massachusetts (1.5%), New York (1.5%), and Pennsylvania (1.4%). The largest increases in initial claims for unemployment insurance for the week ended September 21 were in Virginia (+688), Washington (+596), Ohio (+584), Louisiana (+382), and North Carolina (+236), while the largest decreases were in New York (-1,510), Texas (-1,450), South Carolina (-641), Wisconsin (-532), and Massachusetts (-531).
Eye on the Week Ahead
The latest inflation data is available this week, with the release of the Consumer Price Index for September. The CPI inched up 0.2% in August and 2.5% since August 2023. Most forecasters predict September’s data should be in line with the data from August.
The Markets (third quarter through September 30, 2024)
Wall Street got off to a good start to begin the third quarter of 2024 and continued to rally for much of the quarter. Investors spent the quarter watching inflation and economic data, trying to gauge whether the Federal Reserve might lower interest rates. Each month of the quarter provided solid evidence that inflationary pressures had been curbed. Both the personal consumption expenditures (PCE) price index and the Consumer Price Index (CPI) declined over the last three months, with the 12-month rate for the CPI ending the quarter at 2.5%, and the PCE price index closing the quarter at 2.2%. In response, the Federal Reserve cut the federal funds target rate range by 50.0 basis points, marking the first rate reduction since March 2020 in the midst of the COVDI-19 pandemic. Several indexes reached new records throughout the quarter. The S&P 500 is off to its best nine-month start since 1997, while the Dow and the NASDAQ also hit new highs in the third quarter. Among the market sectors, only energy failed to close the quarter higher. The remaining 10 sectors recorded notable gains, led by utilities (19.1%), real estate (17.1%), industrials (12.6%), and materials (11.1%). Rising bond prices weighed on yields, with the yield on 10-year Treasuries closing lower in each month of the quarter. The yield on the 2-year note ended the quarter at 3.65%, a decrease of 84.0 basis points from the beginning of the quarter. Corporate earnings enjoyed a solid quarter, with 80.0% of S&P 500 companies reporting actual earnings per share (EPS) above the five-year average of 77.0%. The S&P 500 further reported growth in earnings of 11.3%, marking the highest year-over-year growth since the fourth quarter of 2021.
Gold rose nearly 14.0% in the third quarter and nearly 28.0% in 2024 as anticipated interest rate cuts by central banks supported trading precious metals. In addition, higher demand for gold by several Asian central banks, particularly the People’s Bank of China, helped lift the price of gold, which reached a record high of $2,685.15 per ounce at the end of September. Crude oil prices fell about 16.0% in the third quarter as China’s economic struggles, rising supplies, weak demand, and escalating tensions in the Middle East took their toll. The retail price for regular gasoline was $3.185 per gallon on September 23, $0.128 below the price a month earlier and $0.253 less than the price at the end of the second quarter. Regular retail gas prices decreased $0.652 from a year ago. The U.S. dollar ended the quarter down nearly 5.0%. Home mortgage rates averaged 6.2% as of September 12, about 0.57% percent lower than the July 18 rate and down from 7.18% a year ago.
July proved to be an interesting month in the stock market as tech stocks, which had been the bellwether of the market for much of the year, dipped lower, replaced by small- and mid-cap stocks. While the Federal Reserve did not change the Fed funds rate in July, there was plenty of rhetoric supporting a rate cut as early as September. Economic data and Inflation indicators offered further support to a reduction in interest rates. The CPI registered 3.0% for the 12 months ended in June, a 0.3 percentage point decrease from the May yearly estimate. The PCE price index increased by 2.5% for the year ended in June, down from the May figure of 2.6%. Job gains slowed to 145,000 in June (revised), below the 12-month average of 215,000. Investors seemed to make moves based on the anticipated rate cuts. Lower interest rates tend to support smaller stocks, which are generally leveraged by borrowed funds. As such, the small caps of the Russell 2000 led the benchmark indexes listed here, gaining 10.1%, which accounted for most of its year-to-date 11.2% gain. The Dow rose 4.4% and the S&P 500 inched up 1.1%. The NASDAQ dipped 0.8%. Interest-sensitive market sectors also benefited from the projected rate cuts, with real estate, utilities, and financials leading the way, while information technology and communication services closed the month lower. Anticipated rate cuts also had an impact on bonds. The inverted yield curve between the 2-year and 10-year spread flattened, with yields on 10-year Treasuries falling 24.0 basis points. The retail price for regular gasoline at the end of July was $3.484 per gallon, down $0.273 from July 2023.
In August, Wall Street got off to a sluggish start only to rebound by the end of the month. Each of the benchmark indexes listed here posted gains (with the exception of the Russell 2000). The Global Dow gained 2.6%, followed by the S&P 500, which rose 2.3%. The Dow advanced 1.8% and the NASDAQ ticked up 0.7%. The Russell 2000, which could not maintain its strong July performance, fell 1.6%. While tech shares rebounded somewhat, the market broadened in general. Real estate and consumer staples led the market sectors, while consumer discretionary and energy declined. The Federal Reserve did not meet in August. However, Fed Chair Jerome Powell clearly intimated that there was strong consideration to lowering interest rates in September. With inflation indicators continuing to show a disinflationary trend, the focus shifted to employment, where job gains in July slipped to 89,000 (revised), while the unemployment rate settled at 4.2%. Bond prices rose again, dragging yields down 20.0 basis points to 3.90%. However, despite favorable stock market returns and a stabilized inflation rate, concerns over the shrinking labor market, a slowdown in industrial production, and the switch of presidential candidates, prompted some skepticism among investors.
September, which is historically a poor month for stocks, bucked that trend, with each of the benchmark indexes listed here closing the month higher. The Fed’s 50.0 basis-point interest rate cut, coupled with signs of resilience in the economy, helped raise investor confidence in the stock market. Each of the indexes listed here closed September higher, despite a slow start to the month. Consumer discretionary and utilities led the market sectors, which generally performed well in September, with the exception of health care, real estate, and energy, which lagged. Ten-year Treasury yields dipped lower. As aforementioned, the Fed cut interest rates by 50.0 basis points following the conclusion of its meeting on September 18. As a result, stocks moved generally higher, although several of the Fed officials tempered their comments concerning whether or when additional rate cuts may occur. Crude oil prices ended the month lower as weaker demand, coupled with rising surpluses, eclipsed concerns over escalating tensions in the Middle East. Gold prices advanced in September, enjoying several record highs along the way.
Stock Market Indexes
Market/Index
2023 Close
As of September 30
Monthly Change
Quarterly Change
YTD Change
DJIA
37,689.54
42,330.15
1.85%
8.21%
12.31%
NASDAQ
15,011.35
18,189.17
2.68%
2.57%
21.17%
S&P 500
4,769.83
5,762.48
2.02%
5.53%
20.81%
Russell 2000
2,027.07
2,229.97
0.56%
8.90%
10.01%
Global Dow
4,355.28
5,029.62
1.93%
7.54%
15.48%
fed. funds target rate
5.25%-5.50%
4.75%-5.00%
-50 bps
-50 bps
-50 bps
10-year Treasuries
3.86%
3.80%
-10 bps
-30 bps
-6 bps
US Dollar-DXY
101.39
100.75
-0.91%
-4.85%
-0.63%
Crude Oil-CL=F
$71.30
$68.35
-7.15%
-16.15%
-4.14%
Gold-GC=F
$2,072.50
$2,654.60
4.71%
13.69%
28.09%
Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.
Latest Economic Reports
Employment: Total employment increased by 142,000 in August, below the consensus of 160,000 and lower than the 12-month average gain of 202,000. The August estimate followed downward revisions in both June and July, which, combined, were 86,000 lower than previously reported. In August, job gains occurred in construction and health care. The unemployment rate for August ticked down 0.1 percentage point to 4.2% but was 0.4 percentage point above the rate from a year earlier (3.8%). The number of unemployed persons dipped by 48,000 to 7.1 million (6.3 million in August 2023). In August, the number of long-term unemployed (those jobless for 27 weeks or more) was unchanged at 1.5 million and accounted for 21.3% of all unemployed people. Both the labor force participation rate, at 62.7%, and the employment-population ratio, at 60.0%, did not change from the previous month. In August, average hourly earnings increased by $0.14, or 0.4%, to $35.21. Since August 2023, average hourly earnings rose by 3.8%. The average workweek edged up 0.1 hour to 34.3 hours.
There were 218,000 initial claims for unemployment insurance for the week ended September 21, 2024. During the same period, the total number of workers receiving unemployment insurance was 1,834,000. A year ago, there were 213,000 initial claims, while the total number of workers receiving unemployment insurance was 1,795,000.
FOMC/interest rates: The Federal Open Market Committee cut the federal funds target rate range by 50.0 basis points to 4.75%-5.00% following its September meeting. This was the first rate reduction in four years. The statement released by the Committee noted that it had achieved the greater confidence it sought on the path of disinflation, as the risks to the dual mandate of maximum employment and price stability were “roughly in balance.”
GDP/budget: According to the third and final estimate from the Bureau of Economic Analysis, the economy, as measured by gross domestic product, accelerated at an annualized rate of 3.0% in the third quarter of 2024. GDP increased 1.6% in the first quarter. Personal consumption expenditures rose 2.8% in the second quarter compared to a 1.5% increase in the previous quarter. Consumer spending on goods increased 3.0%, while spending on services rose 2.7%. Personal consumption expenditures (1.90%) contributed the most to overall economic growth. Gross domestic investment advanced 8.3% in the second quarter, well above the 3.6% increase in the first quarter. Nonresidential (business) fixed investment advanced 3.9% in the second quarter (4.4% in the first quarter), while residential fixed investment declined 2.8%, compared to a 13.7% increase in the first quarter. Exports climbed 1.0%, while imports, which are a negative in the calculation of GDP, increased 7.6%. Consumer prices, as measured by the personal consumption expenditures price index, increased 2.5%, compared with an increase of 3.4% in the first quarter. Excluding food and energy prices, the PCE price index increased 2.8%, compared with an increase of 3.7% in the prior quarter.
The federal budget deficit in August was $380.0 billion following July’s deficit of $244.0 billion. In August, government receipts totaled $307.0 billion, while government outlays were $687.0 billion. Through 11 months of fiscal year 2024, the total deficit sits at $1,900.0 trillion, which is roughly $400.0 billion more than the deficit through the first 11 months of the previous fiscal year.
Inflation/consumer spending: The PCE price index ticked up 0.1% in August after increasing 0.2% in July. Prices for goods decreased 0.2%, while prices for services increased 0.2%. Food prices increased 0.1%, while energy prices decreased 0.8%. Excluding food and energy, the PCE price index increased 0.1%. The 12-month PCE price index for August increased 2.2%. Prices for goods decreased 0.9%, while prices for services increased 3.7%. Food prices increased 1.1%, while energy prices decreased 5.0%. Excluding food and energy, the PCE price index increased 2.7% from one year ago. Also in August, both personal income and disposable (after-tax) personal income rose 0.2%. Personal consumption expenditures, a measure of consumer spending, increased 0.2%.
The Consumer Price Index rose 0.2% in August, the same increase as in July. Over the 12 months ended in August, the CPI rose 2.5%, down 0.4 percentage point from the 12-month period ended in July. This was the smallest 12-month increase since February 2021. Excluding food and energy, the CPI rose 0.3% in August, (0.2% in July), and 3.2% from August 2023. Shelter prices rose 0.5% in August and were the main factor in the overall increase. Since August 2023, shelter prices have risen 5.2%. Excluding shelter prices, the CPI was unchanged in August and up 1.1% from a year earlier. Energy prices fell 0.8% from July and 4.0% from August 2023. Prices for food rose 0.1% in August (2.1% for the year).
The Producer Price Index rose 0.2% in August after being unchanged in July. The increase was attributable to a 0.4% increase in prices for services. Prices for goods did not change. For the 12 months ended in August, producer prices advanced 1.7%, 0.5 percentage point below the rate for the 12-months ended in July.
Housing: Sales of existing homes declined 2.5% in August and 4.2% over the last 12 months. According to the National Association of Realtors® (NAR), the market for existing homes remained sluggish but lower mortgage rates and increased inventory should help spur sales moving forward. Unsold inventory of existing homes in August represented a 4.2-month supply at the current sales pace, up slightly from the July estimate. The median existing-home price was $416,700 in August, down from the July estimate of $421,400, but 3.1% above the August 2023 price of $404,200. Sales of existing single-family homes decreased 2.8% in August and were 3.3% under the August 2023 rate. The median existing single-family home price was $422,100 in August, down from $427,200 in July but well above the August 2023 estimate of $410,200.
New single-family home sales decreased in August, falling 4.7% below the July estimate but 9.8% higher than the August 2023 rate. The median sales price of new single-family houses sold in July was $420,600 ($429,000 in July). The August average sales price was $492,700 ($508,200 in July). The inventory of new single-family homes for sale in August represented a supply of 7.8 months at the current sales pace, up from 7.3 months in July.
Manufacturing: Industrial production increased 0.8% in August following a 0.9% in July. Manufacturing output rose 0.9% in August, rebounding from a 0.7% decline in July. The August increase was due, in part, to a recovery in motor vehicles and parts, which jumped nearly 10.0% after falling 9.0% in July. Manufacturing excluding motor vehicles and parts rose 0.3%. Mining output climbed 0.8%, while the index for utilities was unchanged. For the 12 months ended in August, total industrial production was unchanged from its year-earlier level. Over the same period, manufacturing increased 0.2%, mining increased 0.1%, while utilities fell 0.9%.
New orders for durable goods were unchanged in August from July. Excluding transportation, new orders increased 0.5%. Excluding defense, new orders decreased 0.2%. Electrical equipment, appliances, and components, up two of the last three months, drove the increase after advancing 1.9%. New orders for nondefense capital goods decreased 1.3% in August, while new orders for defense capital goods increased 5.3%.
Imports and exports: U.S. import prices ticked down 0.3% in August following increases of 0.1% in both July and June. The August decline in imports was the largest monthly drop since the index decreased 0.7% in December 2023. In spite of the August decline, U.S. import prices increased 0.8% over the past year. Import fuel prices decreased 3.0% in August after increasing 1.1% the previous month. The August drop was the largest one-month decline since the index fell 8.0% in December 2023. Prices for nonfuel imports edged down 0.1% in August. Prices for U.S. exports fell 0.7% in August, after advancing 0.5% the previous month. Lower prices for nonagricultural and agricultural exports each contributed to the decrease in U.S. export prices in August. U.S. export prices fell 0.7% for the year ended in August, the first 12-month drop since April 2024.
The international trade in goods deficit was $94.3 billion in August, down $8.6 billion, or 8.3%, from July. Exports of goods were $177.0 billion in August, 2.4% over July exports. Imports of goods were $253.8 billion in August, 1.6% below the July estimate. Since August 2023, exports increased 4.1%, while imports increased 6.9%.
The latest information on international trade in goods and services, released September 4, is for July and revealed that the goods and services trade deficit was $78.8 billion, up $5.8 billion, or 7.9%, from the June deficit. July exports were $266.6 billion, 0.5% more than June exports. July imports were $345.4 billion, 2.1% above June’s estimate. Year to date, the goods and services deficit increased $36.2 billion, or 7.7%, from the same period in 2023. Exports increased $65.9 billion, or 3.7%. Imports increased $102.1 billion, or 4.5%.
International markets: China’s stock market, which had been tumbling for several months, shot higher at the end of September on the heels of the most aggressive stimulus measures since the pandemic, which included interest rate cuts and fiscal support, in an attempt to rejuvenate China’s sagging economy. Elsewhere, the annual inflation rate in Germany fell to 1.6% in September, the lowest rate since February 2021. Producer prices in Greece fell by 2.4% since August 2023, marking the sharpest deflation since February. Japan’s industrial production fell more than expected in August as motor vehicle output slid 10.6%. For September, the STOXX Europe 600 Index dipped 0.4%; the United Kingdom’s FTSE fell 1.1%; Japan’s Nikkei 225 Index slipped 2.0%; while China’s Shanghai Composite Index jumped 18.7%.
Consumer confidence: Consumer confidence fell in September to 98.7, from an upwardly revised 105.6 in August, according to the Conference Board Consumer Confidence Index®. The Present Situation Index, based on consumers’ assessment of current business and labor market conditions, fell to 124.3 in September, down 10.3 points from the previous month. The Expectations Index, based on consumers’ short-term outlook for income, business, and labor market conditions, declined to 81.7 in September, down from 86.3 in August.
Eye on the Quarter Ahead
The Federal Reserve does not meet in October, so there will be some time to determine the impact of the September 50.0-basis-point rate cut. Of course, all eyes will focus on the results of the presidential and congressional elections in November.
The Markets (as of market close September 27, 2024)
Wall Street enjoyed a solid week of gains following a rough start to the month. Each of the benchmark indexes listed here advanced, with the exception of the Russell 2000, which is generally the most volatile of the aforementioned indexes. Eight of the 11 S&P 500 market sectors closed the week ahead, led by materials and utilities. Only health care, financials, and energy declined. The personal consumption expenditures (PCE) price index, the preferred inflation indicator of the Federal Reserve, inched up 0.1% in August and 2.2% over the last 12 months, nearing the Fed’s 2.0% target. Signs of cooling inflationary pressures likely fueled expectations that the Fed may cut interest rates again this year. Gold prices hit a record high earlier in the week, only to pull back later. Crude oil prices fell below $70.00 per barrel.
Stocks began the last week of September with mixed results. The Global Dow (0.4%) led the benchmark indexes listed here. The S&P 500 (0.3%) and the Dow (0.2%) ticked up higher, but enough to achieve fresh record highs. The NASDAQ ticked up 0.1%. The Russell 2000 (-0.3%) lagged. Ten-year Treasury yields inched up 1.1 basis points to 3.73%. Crude oil prices fell 0.7%, settling at about $70.52 per barrel. The dollar and gold prices posted marginal gains.
The S&P 500 and the Dow hit new records last Tuesday after climbing 0.3% and 0.2%, respectively. The Global Dow (0.8%) gained the most of the remaining benchmark indexes listed here, followed by the NASDAQ (0.6%) and the Russell 2000 (0.2%). Crude oil prices jumped 1.6% to settle at $71.51 per barrel, pushed higher by China’s major economic stimulus measures and escalating tensions in the Middle East. Yields on 10-year Treasuries were unchanged, closing at 3.73%. The dollar fell 0.5%, while gold prices rose 1.4%.
Last Wednesday saw an early-day rally lose steam by the close of trading. Among the benchmark indexes listed here, only the NASDAQ was able to avoid ending the session in the red by less than 0.1%. The remaining indexes declined, with the Russell 2000 falling 1.2%, followed by the Dow (-0.7%), the Global Dow (-0.4%), and the S&P 500 (-0.2%). Bond prices also dipped, sending yields higher, with 10-year Treasuries settling at 3.78%. Crude oil prices slipped just below $70.00 per barrel after declining 2.6%. The dollar (0.5%) and gold prices (0.3%) advanced.
Strong corporate earnings and favorable economic data helped lift stocks higher last Thursday. The Global Dow led the indexes after gaining 1.1%. The NASDAQ, the Dow, and the Russell 2000 each climbed 0.6%. The S&P 500 rose 0.4%, enough to notch another record high. Ten-year Treasury yields ticked up to 3.79%. Crude oil prices decreased for the second straight day, falling 3.2% to $67.47 per barrel. The dollar fell 0.3%, while gold prices advanced 0.4%.
Stocks finished mixed on Friday as investors contemplated how the Federal Reserve would view the latest inflation data. The Russell 2000 gained 0.7%, the Global Dow rose 0.5%, while the Dow reached another record high after increasing 0.3%. The NASDAQ fell 0.4% and the S&P 500 dipped 0.1%. Crude oil prices rebounded after advancing 1.3%. Yields on 10-year Treasuries dipped to 3.74%. The dollar and gold prices declined.
Stock Market Indexes
Market/Index
2023 Close
Prior Week
As of 9/27
Weekly Change
YTD Change
DJIA
37,689.54
42,063.36
42,313.00
0.59%
12.27%
NASDAQ
15,011.35
17,948.32
18,119.59
0.95%
20.71%
S&P 500
4,769.83
5,702.55
5,738.17
0.62%
20.30%
Russell 2000
2,027.07
2,227.89
2,224.70
-0.14%
9.75%
Global Dow
4,355.28
4,946.28
5,064.45
2.39%
16.28%
fed. funds target rate
5.25%-5.50%
4.75%-5.00%
4.75%-5.00%
0 bps
-50 bps
10-year Treasuries
3.86%
3.72%
3.74%
2 bps
-12 bps
US Dollar-DXY
101.39
100.79
100.39
-0.40%
-0.99%
Crude Oil-CL=F
$71.30
$71.77
$68.57
-4.46%
-3.83%
Gold-GC=F
$2,072.50
$2,644.90
$2,674.90
1.13%
29.07%
Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.
Last Week’s Economic News
Gross domestic product (GDP) rose 3.0% in the second quarter, according to the third and final estimate from the Bureau of Economic Analysis. Personal consumption expenditures, the largest contributor to over all GDP, rose 1.90%. Current dollar GDP increased 5.6% in the second quarter. The personal consumption expenditures (PCE) price index increased 2.5% (3.4% in the first quarter). Excluding food and energy prices, the PCE price index increased 2.8% (3.7% in the first quarter).
Personal income increased $50.5 billion, or 0.2%, in August, according to estimates released today by the U.S. Bureau of Economic Analysis. Disposable personal income, personal income less personal current taxes, increased $34.2 billion, or 0.2%, and personal consumption expenditures (PCE) increased $47.2 billion, or 0.2%. The PCE price index increased 0.1%. Excluding food and energy, the PCE price index also increased 0.1%. Since August 2023, the PCE price index has risen 2.2%, while the PCE price index less food and energy rose 2.7%.
Sales of new single-family houses in August 2024 were 4.7% below the July rate but 9.8% above the August 2023 estimate. The median sales price of new houses sold in August 2024 was $420,600. The average sales price was $492,700. Inventory of new single-family houses for sale represented a supply of 7.8 months at the current sales rate.
New orders for manufactured durable goods in August, up six of the last seven months, were unchanged from July, which estimated a 9.9% increase in durable goods orders. Excluding transportation, new orders increased 0.5%. Excluding defense, new orders decreased 0.2%.
The international trade in goods deficit was $94.3 billion in August, down $8.6 billion from July. Exports of goods for August were $177.0 billion, $4.1 billion more than July exports. Imports of goods for August were $271.3 billion, $4.5 billion less than July imports.
The national average retail price for regular gasoline was $3.185 per gallon on September 23, $0.005 per gallon above the prior week’s price but $0.652 per gallon less than a year ago. Also, as of September 23, the East Coast price fell $0.033 to $3.052 per gallon; the Midwest price increased $0.072 to $3.077 per gallon; the Gulf Coast price rose $0.005 to $2.733 per gallon; the Rocky Mountain price climbed $0.034 to $3.434 per gallon; and the West Coast price decreased $0.025 to $4.111 per gallon.
For the week ended September 21, there were 218,000 new claims for unemployment insurance, a decrease of 4,000 from the previous week’s level, which was revised up by 3,000. According to the Department of Labor, the advance rate for insured unemployment claims for the week ended September 14 was 1.2%, unchanged from the previous week’s rate. The advance number of those receiving unemployment insurance benefits during the week ended September 14 was 1,834,000, an increase of 13,000 from the previous week’s level, which was revised down by 8,000. States and territories with the highest insured unemployment rates for the week ended September 7 were New Jersey (2.4%), California (2.0%), Puerto Rico (2.0%), Rhode Island (2.0%), Nevada (1.7%), Washington (1.7%), Massachusetts (1.6%), New York (1.6%), Illinois (1.5%), and Pennsylvania (1.4%). The largest increases in initial claims for unemployment insurance for the week ended September 14 were in Texas (+2,216), New York (+1,842), California (+1,108), Georgia (+1,014), and Michigan (+787), while the largest decreases were in Massachusetts (-1,969), Wisconsin (-794), Connecticut (-569), Nebraska (-517), and Louisiana (-224).
Eye on the Week Ahead
October kicks off with the release of the September employment figures. Job gains have slowed notably over the past few months, which contributed to the cut in interest rates by the Federal Reserve. It appears that the Fed is nearing its goals of maximum employment and 2.0% inflation.
What I'm Watching This Week 